This requires that you go click the macro add-in button for CRM before it will process the mail merge and more importantly, it does not give you the options to reload it back into CRM.
Since I had to generate a number of quotes today, this was a bit more annoying than usual. I spent a while searching today for blog article on this and found nothing. After digging for a while I decided to use the diagnostics tool, which showed errors that said add-ins had been disabled for use in Outlook and Excel. Repairing the errors solved the problem. So if your Outlook mail merges start misbehaving, and give you a screen that looks like this:
followed by this:
just run the CRM diagnostics and tell it to fix all errors. By the way, this is exactly how mail merges look if you invoke them strictly from the Web client.
I hope this saves you a few moments.
Steve Noe, CRM-MCT